Insurance in Washington

Washington requires liability insurance as a condition of contractor registration. Minimums under RCW 18.27 are $200,000 public liability and $50,000 property damage, or a $250,000 combined single limit. This is the floor. Most commercial general contractors require much higher limits ($1M per occurrence / $2M aggregate is the common commercial minimum). Workers' compensation in Washington is handled through L&I's state fund, not private carriers. Every employer with at least one worker must maintain L&I coverage. Owner-only sole proprietors can opt out by filing for an exemption, but the moment they hire a first employee the coverage requirement kicks in. L&I industrial insurance rates are published by risk classification. Trade work classifications range widely. Residential framing and structural steel carry high rates; HVAC service carries lower rates. Expect rates that translate to roughly 5 to 15 percent of payroll for trade work, depending on class. Other coverages to consider: - Commercial auto for trucks and vans used in the business. - Hired and non-owned auto for employees driving their own vehicles on company business. - Inland marine (contractor's equipment) for tools and job-site equipment. - Pollution liability if you work with refrigerants, fuel oil, or hazardous materials. - Employment practices liability (EPLI) once you have a handful of employees. Shop rates annually. Trade association programs through associations like ABC, AGC, PHCC, NECA often beat street rates.